Many Companies are Finding Out that America is the Place to Spend Cashhttp://www.fool.com/investing/general/2014/01/13/many-companies-are-finding-out-that-america-is-the.aspx Callum Turcan
January 13, 2014
It has been a good run, but now it's time to part ways. Marathon Oil (NYSE: MRO) is going to sell its North Sea assets in Norway and the U.K., which could fetch $3 billion according to UBS Investment Research.
By shedding these assets, Marathon Oil can focus on what really matters: America. With more cash being devoted toward this great country, Marathon Oil will be able to double 2013 output to ~160,000 boe/d in the Eagle Ford by 2017.
America's favorite bird
Part of Marathon Oil's cash flow growth is going straight back into the business. Marathon's capex increased to $5.9 billion this year, as compared to $5.2 billion last year. While the Eagle Ford is going to receive a shot of adrenaline, two other shale plays will also experience more investment.
In the course of just under four years, Apache has grown the portion of its production from North American onshore assets to 56% from 32%. Along with this came even better news: the production mix shifted toward higher margin liquids. In that same time period, liquids grew to 55% of output from 50%.
So far, Apache's plan has worked wonders; 94% of its 201,000 boe/d production growth came from onshore North American plays since 2009. Now Apache is pumping out almost 800,000 boe/d, and there is no reason to believe that growth will stop.
Apache has divested $7 billion in assets to focus on shale plays in America, primarily in the Permian Basin. Output is already exceedin